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Dr Dre joins Apple as $3bn buyout of Beats Electronics is confirmed

Straight outta Cupertino
Thu May 29 2014, 09:59

APPLE HAS CONFIRMED that is it has bought Dr Dre's Beats Electronics for a cool $3bn, a deal that will see it take control of Beats headphones and its music streaming service.

Apple confirmed the deal, which is the biggest in its history on Wednesday, after reports appeared earlier this month claiming that Apple was planning to acquire the firm for $3.2bn. It's unclear why the amount decreased, but we're guessing Dr Dre's Facebook video, in which he boasted that he's become the "first billionaire in hip hop", didn't work in his favour.

Apple said that it will pay $2.6bn in cash for Beats, and the remaining $400m in stock. The deal will see Beats co-founders Dr Dre and Jimmy Iovine joining Apple, where their titles reportedly will be simply "Jimmy" and "Dre"." This reportedly will see Iovine leave his position as CEO of music label Interscope, where he has been in charge for the past 25 years.

The two brands will remain separate for now, and will even offer competing services with iTunes Radio and Beats Music. However, Beats Music will report directly to Apple, with iTunes boss Eddy Cue - the one with the un-cool shoes in the above image - taking charge. Apple's former marketing chief Phil Schiller will take control of Beats' headphone and speaker division.

It's unclear whether Apple will offer Beats headphones with future iPhones and iPods or whether it will simply continue to sell Beats kit in its Apple stores.

Apple CEO Tim Cook said, "Music is such an important part of all of our lives and holds a special place within our hearts at Apple, that's why we have kept investing in music and are bringing together these extraordinary teams so we can continue to create the most innovative music products and services in the world."

Jimmy Iovine added, seemingly forgetting about his firm's previous partnership with HTC, "I've always known in my heart that Beats belonged with Apple.

"The idea when we started the company was inspired by Apple's unmatched ability to marry culture and technology. Apple's deep commitment to music fans, artists, songwriters and the music industry is something special."

Full details of the acquisition are yet to be confirmed, but Cook told the Financial Times that Beats' Android and Windows apps will continue. While Apple hasn't coughed on details, HP also told The INQUIRER on Thursday that it will continue to offer Beats Audio in its upcoming products.

A spokesperson said in a statement, "HP will continue to develop and offer leading products that include premium technology experiences, including the richest and most dynamic sound experience."

Apple expects the deal to close in the fourth quarter, subject to regulatory approval.

We'll likely hear more about the deal at next week's WWDC, which kicks off in San Francisco on Monday.

We've also got a sneaking suspicion that Dr Dre might take to the stage to announce details about his long-awaited Detox album. If we're right - you heard it here first, if not - forget we said anything. µ

 

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